U.S. LNG in Overdrive in 2025

Written by Daniel Graeber for IIR News (Sugar Land Texas)

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Summary

The Plaquemines LNG facility, which became the eighth export terminal for LNG in the United States in late December, helped lead to a surge in the sector last year. That could be contributing to a global glut, however.

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2025 Ended on a High Note

Supported in large part by operations at the Plaquemines export facility in Louisiana, feed gas for the U.S. liquefied natural gas (LNG) sector ended 2025 on a high note, data from IIR Energy show.

Drawing on its vast shale natural gas deposits inland, the United States emerged as the world leader in exports of LNG in 2022. That came just as global energy security was at risk due to the loss of Russian gas from sanctions invoked over its invasion of Ukraine that year.

That war is ongoing, and European countries in particular are still looking to the likes of Norway and the United States for gas volumes. Last week, Greece-based METLEN Group (Athens), along with its partners at the International Energy Supply & Trading Pillar, announced the arrival of the first-ever batch of U.S.-sourced LNG at a port in Alexandroupolis.

The amount of feed gas that supports those LNG deliveries ended 2025 on a high note, with volumes far exceeding federal estimates. In the NATGAS Today report from IIR Energy, data showed that December feed gas volumes averaged 19.26 billion cubic feet per day (Bcf/d), besting levels from the same time in 2024 by nearly 24%.

The U.S. Energy Information Administration (EIA), the statistical arm of the Energy Department, predicted that feed gas levels would average 14.9 Bcf/d last year and increase to 16.3 Bcf/d for 2026.

It was the Plaquemines facility, which started commercial operations in late 2024, that had the most impact on feed gas volumes last year. With a design capacity of 3.8 Bcf/d in feed gas volumes, Plaquemines is already the second-largest LNG export terminal in the United States, after Cheniere Energy's (Houston, Texas) Sabine Pass terminal.

Venture Global LNG (Arlington, Virginia), the operator, in November filed an application with the Federal Energy Regulatory Committee (FERC) to increase the export capacity even further.

U.S. natural gas looks promising as well. Unlike inland crude oil production, which is on pace for a 130,000-barrel-per-day decline from 2025 levels, domestic gas should remain supportive of an LNG sector getting special treatment from President Donald Trump, who's dusted off projects from Alaska to the Gulf Coast during his second, non-consecutive term in office.

Too Much of a Good Thing

A December report from the Institute for Energy Economics and Financial Analysis (IEEFA), however, said slumping demand and a "massive" infusion of new export capacity is expected to put the global LNG market in an oversupply situation before the decade is out.

That's coming largely from markets in Asia, which are export targets for both U.S. and Canadian LNG ambitions. Japan, which has few fossil fuel resources of its own, has seen LNG imports decline 20% since 2018, analysis from the IEEFA found.

A planned increase in renewable energy, the revival of Japan's nuclear power sector after the Fukushima Daichi disaster in 2011 and higher LNG prices are likely to send demand even lower.

South Korea, meanwhile, is among the largest buyers of U.S.-sourced LNG by volume. But annual imports were down from 2024 levels and the government expects levels to fall another 20% as additional renewable and nuclear facilities come online.

For Europe, meanwhile, IEEFA said imports have largely stagnated. "Europe's overall gas consumption fell 20% in the past two years due to high prices, energy security mandates and climate policies," its report read. "IEEFA expects Europe's LNG demand to peak by 2025 and decline through 2030."

That doesn't bode well for either U.S. or Canadian ambitions. So far, Canada has beat the United States to Asia with debut cargoes last year from the LNG Canada terminal in British Columbia.

Subscribers can learn more in the plant profile.

Domestically, the export commitments for LNG could strain supplies on the U.S. market, where some 40% of consumers get their power and heat from natural gas. Henry Hub, the benchmark for the wholesale price of U.S. natural gas, averaged $2.28 per million British thermal units in 2024. It's expected to average $4.17 this year, according to EIA estimates.

Key Takeaways

• Last year was a record-setter for U.S. LNG
• First-ever delivery to the Greek terminal at Alexandroupolis
• A glut is coming, however

By the Numbers

• 40% of U.S. consumers use natural gas, not LNG.
• 19.26 billion cubic feet per day in supporting feed gas in December
• 2025 may have been the peak for European LNG demand

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